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Mylan NV (NAS:MYL)
Beneish M-Score
-1.90 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Mylan NV has a M-score of -1.90 signals that the company is a manipulator.

MYL' s Beneish M-Score Range Over the Past 10 Years
Min: -4.35   Max: -0.52
Current: -1.9

-4.35
-0.52

During the past 13 years, the highest Beneish M-Score of Mylan NV was -0.52. The lowest was -4.35. And the median was -2.47.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Mylan NV for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.389+0.528 * 0.9861+0.404 * 1.2097+0.892 * 1.2117+0.115 * 0.7567
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0499+4.679 * -0.0249-0.327 * 0.6653
=-1.90

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $2,917 Mil.
Revenue was 2695.2 + 2371.7 + 1871.7 + 2082.7 = $9,021 Mil.
Gross Profit was 1315.3 + 1008.1 + 830.1 + 969 = $4,123 Mil.
Total Current Assets was $6,486 Mil.
Total Assets was $21,317 Mil.
Property, Plant and Equipment(Net PPE) was $1,885 Mil.
Depreciation, Depletion and Amortization(DDA) was $860 Mil.
Selling, General & Admin. Expense(SGA) was $2,010 Mil.
Total Current Liabilities was $3,684 Mil.
Long-Term Debt was $5,846 Mil.
Net Income was 428.6 + 167.8 + 56.6 + 189.2 = $842 Mil.
Non Operating Income was -50.9 + -2 + -18.5 + -38.1 = $-110 Mil.
Cash Flow from Operations was 974.8 + 114.7 + 267 + 126.6 = $1,483 Mil.
Accounts Receivable was $1,733 Mil.
Revenue was 2084 + 1837.3 + 1715.6 + 1808.5 = $7,445 Mil.
Gross Profit was 1012.4 + 808.8 + 737.8 + 795.9 = $3,355 Mil.
Total Current Assets was $5,818 Mil.
Total Assets was $15,174 Mil.
Property, Plant and Equipment(Net PPE) was $1,738 Mil.
Depreciation, Depletion and Amortization(DDA) was $540 Mil.
Selling, General & Admin. Expense(SGA) was $1,580 Mil.
Total Current Liabilities was $4,474 Mil.
Long-Term Debt was $5,724 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(2917.1 / 9021.3) / (1733.3 / 7445.4)
=0.32335694 / 0.23280146
=1.389

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(1008.1 / 7445.4) / (1315.3 / 9021.3)
=0.45060037 / 0.45697405
=0.9861

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (6485.9 + 1884.7) / 21316.5) / (1 - (5817.8 + 1738.3) / 15174.1)
=0.60731827 / 0.50203966
=1.2097

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=9021.3 / 7445.4
=1.2117

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(540.2 / (540.2 + 1738.3)) / (859.9 / (859.9 + 1884.7))
=0.2370858 / 0.31330613
=0.7567

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(2010.1 / 9021.3) / (1580.1 / 7445.4)
=0.22281711 / 0.212225
=1.0499

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((5845.8 + 3684.1) / 21316.5) / ((5723.5 + 4473.9) / 15174.1)
=0.44706683 / 0.67202668
=0.6653

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(842.2 - -109.5 - 1483.1) / 21316.5
=-0.0249

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Mylan NV has a M-score of -1.90 signals that the company is likely to be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Mylan NV Annual Data

Mar06Mar07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.81211.12811.04311.06940.87571.09620.98281.15181.11561
GMI 0.99650.95381.2990.98921.00130.97280.97720.97250.96291
AQI 1.1471.86912.18320.99850.99110.98930.95771.07730.76891
SGI 1.0031.28213.18740.99131.07021.12461.10871.01661.11731
DEPI 1.14441.25550.28791.08471.01630.91751.00411.18880.9821
SGAI 0.86720.74591.53341.00560.96680.99391.0340.9951.0331
LVGI 4.09761.08981.16410.96270.98791.09480.94031.0931.00731
TATA -0.1273-0.0642-0.0554-0.0365-0.0479-0.0145-0.0261-0.0267-0.0025-0.0025
M-score -4.16-2.04-0.34-2.58-2.75-2.41-2.54-2.44-2.40-2.49

Mylan NV Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.10841.15181.08471.02620.9251.11561.19791.37681.3890.9705
GMI 0.97220.97250.97110.98020.97140.96290.95950.97320.98611.0221
AQI 0.97311.07731.10621.11660.91230.76890.95630.951.20971.5407
SGI 1.03321.01661.02181.03951.09111.11731.12621.17971.21171.2215
DEPI 1.12651.18881.19231.18651.08080.9820.95850.83440.75670.2409
SGAI 0.99130.98660.98951.06641.05611.04181.08031.06061.04991.0982
LVGI 1.07871.0930.92451.01161.03951.00730.73450.73270.66530.6733
TATA -0.0235-0.0267-0.0372-0.0398-0.0249-0.0025-0.00380.0009-0.0249-0.0136
M-score -2.50-2.44-2.48-2.56-2.65-2.41-2.17-1.95-1.90-2.14
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